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[Apha Biz=(Chicago) Reporter Paul Lee] Investors in ERUM TNC Exchange Bonds (EB) owned by the owner family of Eco Pro Group appear to have earned more than 400% in seven months due to a surge in Eco Pro BM stock prices.
This is because EB investors exercised a large number of EB exchange rights on the 26th of last month. Concerns are rising that the stock price of EcoproBM may plunge the day after the exchange rights are exercised (27th), raising the issue of overhang.
According to the financial investment industry on the 3rd, investors who invested in EB issued by Irum TNC in December last year exercised exchange rights worth 30 billion won.
Earlier, Erum TNC issued EB worth 100 billion won, with a surface interest rate of 0% and a maturity guarantee return of 3% on a per-unit basis. Investors can be guaranteed 112.55 percent of the principal if they hold it by Dec. 1, 2026, the expiration date, and if they exercise their exchange right, they can enjoy capital gains.
EB investment was conducted in a private equity manner, so it is not known who the specific investors are. EB is a corporate bond that is exchanged for a third company stock or treasury stock held by the issuing company at the will of the private creditor.
The problem is that the stock price of Ecoprobm plunged 17.25% the day after the exchange rights were exercised. The stock price closed at 376,500 won.
The market estimated that a large amount of EcoProBM was on the market following the exercise of EB exchange rights. The bond balance held by ERUMTYNC EB investors is around KRW 70 billion.
AlphaBIZ 김지선(stockmk2020@alphabiz.co.kr)
